Advocates fight for manufactured housing rights against Havenpark Communities

Candi Evans bought her mobile home with her husband in 1998. The two, hoping to put roots down for years to come, built a family room addition — primarily by themselves with help from a contractor — where they did the installation, woodworking, sanding and staining. Her husband died in 2002. Ms. Evans worked until […]

Candi Evans bought her mobile home with her husband in 1998. The two, hoping to put roots down for years to come, built a family room addition — primarily by themselves with help from a contractor — where they did the installation, woodworking, sanding and staining. Her husband died in 2002. Ms. Evans worked until she was 70 to ensure she was debt-free and didn’t have to “be a burden on anybody.” Then, finally able to retire on a fixed income, she stopped working in January 2019. By the end of March 2019, she received a notice on her door: Golf View Mobile Home Park (MHP) had sold to Utah-based Havenpark Communities just a few weeks prior and raised rent by 61%. 

Havenpark is one of many private equity companies following a proven business model with a simple playbook – buy mobile home (or manufactured housing) parks for a premium from mom-and-pop owners. Kevin Borden, executive director of MHAction, says they then increase the rent to unprecedented levels, collect punitive fees, separate utilities like garbage, sewer and water from lot rent and evict residents who cannot keep up. This increases the value of the land, allowing ambitious MHP owners to bank the passive income or invest it in a nearby MHP elsewhere. Like most mobile home residents, Ms. Evans owns her home but not the land underneath, leaving her financial investment susceptible to outside interests — and skyrocketing rent prices — that are out of her control. Ms. Evans reached out to other homeowners, advocate groups and anyone who would listen. But for several years, state legislation that included rent justification for lot price increases, longer notice times and good-cause evictions stalled and eventually fizzled out despite bipartisan support and constant pressure from mobile homeowners. Havenpark’s business strategy Havenpark bought Golfview for $12.3 million. At the time, the land was assessed at just $5.28 million.  Havenpark states that many previous owners deliberately keep rent low out of “altruistic intent” for long-time residents in most situations. Havenpark says mom-and-pop owners don’t sufficiently invest back into improving the park. This has unintended consequences until deferred maintenance is addressed. Since 2019, Ms. Evan’s monthly rent has increased by $205.  In an email to the CBJ, Havenpark said they acknowledged their mistake of excessively large rent increases and no longer raise rents by more than $50 at a time. However, like other MHP owners, they say that keeping rent at a “market rate” is the only way to combat “rising operating costs and general inflation” and still make community improvements. Mr. Borden believes this practice is an example of a large corporation engaging in land speculation deals. “They’re overvaluing the land that they’re purchasing, which makes the current community owner much more open to sell,” he said. “And then they’re making up that difference for their shareholders by increasing rents exponentially.” He says Havenpark is only attempting to justify “a nebulous reality of fair market rents” with “voodoo economics” while owners boast about staggering profit margins in investment schools. On a now-defunct page on Havenpark’s website, the company says tenant turnover is “minimal since it is difficult and costly for tenants to move their homes.” “The strategy is to trap your money source,” said Assistant Attorney General Ben Bellus. Mobile homeowners, he said, face a series of challenges because their homes aren’t actually mobile: It can cost up to $6,000 to $12,000 to move; some parks might require a resident to cut hitches or take off axles in a lease; older home models are virtually impossible to transport on a highway; and homes deteriorate over time. Havenpark insists they are looking to own MHPs for the long term. They say they have spent approximately $793,000 on community improvements at Golf View since 2019.

Current legislation Three years after Ms. Evan’s notice on her door, Iowa’s state government is on the verge of passing legislation to increase the notification time for rent increases from 60 to 90 days, changing the presumption from retaliation period from six months to one year and making mobile homeowners exempt from property taxes. Critics of the compromise bill say the legislation doesn’t address the underlying concerns in a meaningful way. The barrier to getting better protections for residents passed is the Iowa Manufactured Housing Association (IMHA), said State Representative Lindsay James, D-Dubuque. “It continues to shock me the outsized influence that special interests lobbying groups have in shaping our laws.” According to the Des Moines Register and The New Yorker, the IMHA political action committee (PAC) received $50,000 from a Havenpark managing partner. In addition, House Speaker Pat Grassley, R-New Hartford, received a $30,000 donation from the PAC.  In a statement to the CBJ, the IMHA supports the bills while emphasizing that government-imposed rent controls are bad public policy. When asked why there is no rent justification in the bills, sponsor Brian Lohse, R-Bondurant, said it’s tough to implement price controls on private companies, especially with rising land prices and property taxes.  “I’m paying some of these costs and inflation just like they are, so I guess it’s hard for me to understand why our legislators think that the increased cost should be my burden,” said Ms. Evans.  “Picking the landlords over the residents is a political choice,” said Rep. Zach Wahls, D-Coralville. “Current laws overwhelmingly benefit landlords.” Rep. Lohse said he backed off from rent justification because he believes the language in Iowa’s code already protects residents from unjust evictions. Rep. James, Mr. Belllus and Alex Kornya, litigation director with Iowa Legal Aid, said they believe Rep. Lohse has acted sincerely to improve protections for residents. Still, Mr. Kornya doesn’t agree with his assessment on evictions. “If he thinks there’s an argument there, I don’t see it,” he said. “It’s possible they can use a construction of this language that I don’t see. The problem is when laws aren’t explicit, what they end up meaning depends on a lot of other factors.”  Vague language in the bills surrounding the definition of rent and peaceable possession that, unless revised in future iterations of the bills, could make it easier to evict tenants, said Mr. Kornya.  Havenpark says they do not evict without cause, and their eviction rates in Iowa have been below the national average for the last three years. “It’s not affordable housing if it’s not secure,” said Mr. Bellus. “If you have evil intentions, this system is pretty ripe for abuse.” “If this continues, it doesn’t take a brain surgeon to understand that this will no longer be affordable housing,” said Ms. Evans. Rep. Lohse said he expects the legislation to pass in the coming weeks, and he hopes the bills can “marinate” before the issue is taken up again. What’s next? In January, Havenpark bought two more MHPs, Lake Ridge Estates and Modern Manor, for a combined $33.5 million in Iowa City.  With the expected passage of an IMHA-friendly bill, Mr. Borden isn’t surprised Havenpark is turning its attention back to acquiring new properties. “Only when residents start organizing and winning concessions do they turn their efforts toward protecting their investment at the legislative level,” he said. Rent at the new locations is not expected to increase until this December at the earliest, said Havenpark. “Tenants need to stay active,” said Mr. Bellus. “When people get tired and upset, that’s when the law gets shifted away from them again. They have to stay in front of the public.”